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Creativity, according to Joe Coleman, is the ability to identify problems and generate ideas. Innovation, on the other hand, involves selecting, developing, and commercializing those ideas. These definitions, however, are not the only ones in the field. Creativity can also be described as the presence of multiple ideas, diverse ideas, and novel ideas.

There are specific processes that can enhance problem identification and idea generation, as well as processes that improve idea selection, development, and commercialization. While there is no surefire path to commercial success, following these processes increases the likelihood of generating and selecting good ideas, as well as avoiding wasted investment in their development and commercialization.

Creativity, Innovation, and Market Performance

In broad terms, strategy is all about growth. Decision makers are constantly seeking growth, especially in listed firms where shareholders demand it at increasing rates.

Deciding how to grow requires various models, such as the Ansoff Model. This model breaks down growth into four categories:

a) Market penetration – selling existing products in existing markets

b) Market development – introducing existing products to new markets

c) Product development – creating new products for existing markets

d) Diversification – launching new products in new markets

The above strategies suggest that:

a) There is a strong correlation between new products and market performance, which has been proven correct by Tidd et al. (2005).

b) Innovation is consistently required, regardless of the chosen strategy. Existing products in existing markets must continuously improve their cost/performance mix to outperform competitors, and innovation is necessary to find new markets for existing products. The need for innovation becomes even more obvious when pursuing new product strategies.

Joe Coleman explores these topics in depth in his MBA dissertation on Managing Creativity & Innovation. You can purchase the dissertation, along with a Creativity and Innovation DIY Audit, Good Idea Generator Software, and Power Point Presentation, from http://www.managing-creativity.com.

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Kal Bishop, MBA

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Ihab Salloum